Claireece Precious Jones is 16 years old and pregnant with her father's baby. It will be her second child by him; she gave birth to her first – a daughter with Down's syndrome – when she was 12. At home, her mother beats and sexually molests her. At school, she struggles to read and write. Claireece can barely spell her own name; almost everyone calls her Precious.

It is not, at first, a story with obvious universal appeal and yet it forms the plot of one of the most hotly awaited films of recent years. Precious premiered at the Sundance Film Festival in January where it won the Audience Award and the Grand Jury Prize for best drama. At the Cannes Film Festival in May, the film received a 15-minute standing ovation – this, in spite of its harrowing subject matter and its refusal to offer any easy conclusions.

Based on a 1996 book written by the New York-based performance poet and author known as Sapphire, the film has just been released in America and was hailed by Variety as "courageous and uncompromising, a shaken cocktail of debasement and elation, despair and hope". Oprah Winfrey, one of the most powerful women in America, became the movie's executive producer after watching an early screening and its star, first-time actress Gabourey Sidibe, is now being tipped for an Academy Award, even though she has no professional training and got the part after turning up to an open audition.

For years the original book, Push, remained something of an underground classic. Written in a combination of poetry and street slang, it is an emotionally disturbing novel inspired by the 59-year-old Sapphire's own experiences as a teacher in Harlem in the 1980s. "It was a time when crack addiction was at its height," she said last week. "I used to hear gunshots on the streets. It was the beginning of the Aids epidemic and no one really knew what was happening. All of that was impacting on me and I felt totally swamped… so I really wanted to take this stuff on."

Precious is abused in the foulest ways by the very people who are meant to protect her: her mother, her father, the teachers who fail to notice that she cannot recognise page numbers in her textbooks. And yet, according to Sapphire: "There's nothing in there [the book] that didn't happen to someone."

Sapphire was born Ramona Lofton in Ford Ord, California, where her father was an army sergeant. Her mother was an alcoholic who walked out on her family when Sapphire was 13. She moved to New York in 1977, taking several odd jobs, including a spell as a topless dancer. She began writing poetry in the early 1980s and, at the same time, started teaching underprivileged students to read.

When Push was published, it was praised for its "unsparing realism" and won her a clutch of literary awards. The language is deliberately slapdash and semi-literate, adding to the visceral quality of the prose. "I'm gonna break through or somebody gonna break through to me," Precious says in the first chapter. "I'm gonna learn, catch up, be normal, change my seat to the front of the class."

Although the central character is fictional, Sapphire told CBS newscaster Katie Couric last week in an online interview that she was particularly affected by the experience of one of her former students, a 32-year-old woman with a 20-year-old mentally impaired daughter. "I said: 'Well, what happened?' She said: 'I had a baby when I was 12 by my father.' All the air went out of my body. I was in my 30s then, too. How come I'm the teacher and she's sitting here in this welfare-sponsored class with all these problems? And I realised someone walked in and shattered her life at the age of 12 and she's doing damn good to be in this environment… I just was amazed at her courage."

The result of these first-hand experiences is a shockingly authentic portrayal of a life lived on the very fringes of modern America; it is the telling of a story that simply does not get relayed in the mainstream media, partly, one imagines, because we do not want to believe it is true. The book is unrelentingly bleak. In one explicit scene, Precious is forced to perform oral sex on her mother; later she discovers that she is HIV-positive just as her life seems to be getting back on track. "I see the world as good and bad and it's all thrown together," says Sapphire. "It's human."

The uncomfortable truths at the heart of both the book and the film are occasionally so extreme that it is hard to believe that such a poverty of aspiration can exist in the heady glow of President Obama's post-racial America. "We can't just keep talking about the Obama children," Sapphire told the Observer. "We have to focus on the children who don't have it good.

"The overall issue of the power imbalance between young women and children and adults exist across socio-economic lines. But in the film and in the book this is compounded by poverty, illiteracy, with obesity, with poor housing conditions. So when you add all that up on top of sexual abuse, you have the components that will destroy a soul."

Lee Daniels, the film's director, read Push when it was first published and slept with the book under his pillow for three months. For years, Sapphire refused to sell him the film rights. "It felt like a movie might box her [Precious] in and I wanted her to be free," she says. It was only after she saw the Oscar-winning Monster's Ball, which was produced by Daniels, that she changed her mind.

"As African-Americans, we are in an interesting place," Daniels said in a recent interview with the New York Times. "Obama's the president, and we want to aspire to that. But part of aspiring is disassociating from the face of Precious." The film and what it represents are, according to Daniels, "so not Obama. Precious is so not PC. What I learned from doing the film is that, even though I'm black, I'm prejudiced. I'm prejudiced against people who are darker than me… Making this movie changed my heart. I'll never look at a fat girl walking down the street in the same way again."

Unsurprisingly, given its uncompromising subject matter, Daniels struggled to get the film off the ground. "All the studios said no," he says. "They didn't want to make a film about a 350lb black girl who is abused." Eventually Daniels raised $8m from private investors. Through sheer force of personality, he persuaded his friend Mariah Carey to appear in a minor role as an overworked welfare officer, her face denuded of make-up and almost unrecognisable. Singer Lenny Kravitz also appears as a maternity nurse who helps to deliver Precious's baby.

The role of Precious's mother, possibly the film's most challenging part, is played with an astonishing combination of brutality and sensitivity by Mo'Nique, a comedienne previously famed for her bawdy stand-up routines. "What I dig about Lee Daniels is he's fearless," she said last month. "He tells his truth. So when he called and asked me to play this demon, I said: 'Sign me up, sugar. Sign me up'." With the backing of Winfrey, who was herself sexually abused as a child, the film was picked up by Lionsgate for $5.5m (£3.33m) and will be released in the UK in January. For Sapphire, the attention has come as a total surprise: "I don't know anything about a red carpet! It's a very different world for me. I had not anticipated it [but] it's been 100% positive."

The film is perhaps less harrowing than the book upon which it was based. Rather than showing the sexual abuse in all its awful detail, Daniels chooses to make it implicit and the narrative is spliced with gloriously vivid depictions of Precious's fantasy world, where she envisages herself as a magazine cover-girl or a bestselling hip-hop artist in order to detach herself mentally from the savage cruelties she endures on a daily basis.

It is Precious's overpowering sense of self, her unshakeable capacity to dream of better things, that provides the glimmers of light necessary to hold an audience's attention. It is also what gives the film its universal appeal, despite its painful subject matter. At a screening earlier this year to an audience in Utah, Sapphire recalls that a middle-aged white woman stood up as the closing credits rolled and said: "I'm 60 years old and this is my story."

For Sapphire, the movie is thus not "a black film or a woman's film or a survivor's film. I saw it as a universal film… You know those nature documentaries where the flower blooms in fast motion? That's what this film is like, seeing Precious's soul unfold."